As CEOs come under increased scrutiny for zipping around in corporate jets, execs have begun ditching their own planes for commercial alternatives.
WSJ: At nearly 3 a.m., William L. McComb stands coatless on a chilly airport sidewalk, waiting to collect a rented Volvo. The chief executive of Liz Claiborne Inc. left his midtown Manhattan office about 13½ hours ago, and must lead an important conference call in three hours.
With a corporate jet, “I would have long ago landed and been at my hotel,” Mr. McComb says wearily. The boyish-looking executive, who turned 46 Monday, flies nearly 200,000 miles a year, all of them on commercial flights, almost always in coach…
20-eight U.S. companies, from Altria Group Inc. to Universal Corp., divulged their sale or planned disposal of corporate aircraft in the past two years, says Equilar Inc., which tracks executive compensation and benefits. Several others, including Bristol-Myers Squibb Co. and Citigroup Inc., say they are seeking buyers for company planes.
It’s a tough sell. There were a record 2,522 used business jets for sale as of Nov. 30, up 53% from a year earlier, according to UBS Investment Research.
And just how much do these perks cost the company?
Corporate aircraft aren’t cheap. Planes cost $10 million to $50 million, plus a minimum of $2,000 an hour to operate, estimates David E. Strauss, a UBS analyst. Chartering a plane costs an average of $2,000 to $8,000 per hour.
Photo from WSJ